Product Planning Chapter 4

Opportunity Identification Four general sources for opportunities –Underused resources – excess production capacities –New resources – new skills or technologies, or corporate acquisitions –External mandate – government regulations, industry standards, changing consumer needs –Internal mandate – upper management wants to make a change in direction

Breakdown Structures A way to conceive opportunities Top-down segmentation approach Market segments are identified with key criteria –Size – big enough to be worth pursuing –Identification - able to recognize and describe –Access – feasible to contact segment efficiently –Different response – respond uniquely to different marketing mix elements –Coherence – homogeneous members of the segment –Stability – segment won’t change drastically in near term

Options for Segmentation Demographic elements – age, gender, ethnicity, education, income, etc. B2B demographic elements – age of business, type of product, revenue, number of employees Psychographic – lifestyle and personality Geographic – where are people located Benefit – what benefits are provided Usage – how is the product being used

Product Development Charter Identifies sets of permissions the product development members have General statement identifying what the specific product development initiatives are and what guidelines need to be followed

Elements of a Product Development Charter Four major sections –Background – rationale for the product development initiative –Arena – core competencies of the company that come into play with this initiative –Objectives and goals – broad statements, not specific targets (generally) –Special guidelines – any extra information that is pertinent, key success factors, etc.

Screening Product Development Charters Management needs to pick the best alternatives (charters) for further development Two major categories of criteria –Market-related –Technology-related